Tesla Considers Refining Lithium

Price of battery component has shot up, but supply hasn't
By Bob Cronin,  Newser Staff
Posted Sep 9, 2022 4:50 PM CDT
Tesla Considers Lithium Refinery on Gulf Coast
A staff member chats with visitors to the Tesla booth last week during the China International Fair for Trade in Services in Beijing.   (AP Photo/Ng Han Guan)

Supply chain realities involving batteries have driven Tesla to consider building its own lithium hydroxide refining plant. The maker of electric vehicles has filed a notice with Texas saying that it's considering locations in Texas and Louisiana that have access to the Gulf Coast shipping channel. The company said that it hasn't decided whether to go ahead with the project but that if it does, construction on one Texas site could start late this year. Commercial operation could be going by late 2024, the Wall Street Journal reports.

Such a plant would be "the first of its kind in North America," the Tesla letter said. The plant would process "raw ore material into a usable state for battery production," the application said, and the lithium hydroxide would then be shipped to the company's battery manufacturing plants. CEO Elon Musk had suggested in April that Tesla might start refining lithium because the metal's cost had reached "insane levels," per CNBC. Increased demand for batteries to power electric batteries has pushed the price of lithium, a major component, up 120% this year. At the same time, supply has been hurt by a lack of investment in new projects, partly because of supply chain concerns, per the Journal. (More Tesla stories.)

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